President Donald Trump set up a new clash with an independent agency Monday with his call for the Tennessee Valley Authority to keep open an aging coal-fired plant that buys much of its coal from a company chaired by Robert Murray, one of the president's supporters.
The TVA board will meet Thursday to consider whether to close the 49-year-old plant in Paradise, Ky., which ran only intermittently last year because it was no longer needed to supply steady uninterrupted power known as base load. The board also is considering shutting down a 52-year-old coal-fired unit at Bull Run near Oak Ridge, Tenn.
In a tweet Monday night, Trump said: "Coal is an important part of our electricity generation mix and [the TVA] should give serious consideration to all factors before voting to close viable power plants, like Paradise #3 in Kentucky!"
But the TVA is leaning toward the closure of the Paradise and Bull Run plants precisely because they are not viable.
The agency has already said that closing the Paradise coal-fired plant would have no significant effect. The unit "does not provide the level of flexibility needed to balance hourly, daily and seasonal changes in energy consumption," the agency said in a proposal. "In addition, cycling the unit off and on results in more wear and tear and higher operation and maintenance costs."
"With less need for base load resources, assets that have relatively high projected future maintenance cost and environmental compliance expenditures, high forced outage rates and poor generation portfolio fit are now the focus of more detailed study for potential retirement," the agency said on its website. "The Tennessee Valley Authority's Paradise Fossil Plant (PAF) Unit 3 falls into this category of assets."
As recently as 2013, Murray Energy had delivered 700,000 tons of coal to the Paradise coal plant. But two other coal units on the same site in Muhlenberg County in western Kentucky were replaced with natural gas generation in the spring of 2017. The Paradise unit 3 employs about 140 people.
Robert Murray, founder of Murray Energy and a major Trump supporter, has been pressing the president to help boost coal-fired power plants since the beginning of the administration. In Energy Secretary Rick Perry's first month in office, Murray presented a four-page "action plan" to rescue the coal industry. The plan said that commissioners at three independent regulatory agencies "must be replaced," Environmental Protection Agency staff slashed, and safety and pollution rules "overturn[ed]."
Since November 2013, the TVA board has approved the retirement of 16 coal-fired electric power units at five plants, according to its Securities and Exchange Commission filing. Coal has dropped to 17 percent of TVA's power supply.
"We have a situation where in order to maintain reliable power and keep prices as low as feasible, we have to assess the generation fleet and make some difficult but necessary decisions," TVA spokesman Jim Hopson said.
The closure of coal-fired plants was part of a 2011 agreement the authority made with the EPA, four state governments and three environmental advocacy groups, the Securities and Exchange Commission filing said. More recently, the state of Maryland and seven environmental advocacy groups have filed complaints against the EPA because of excessive nitrogen oxide emissions from TVA plants, including Paradise unit 3.
Trump's call to keep the plant open "flies in face of what we see happening in U.S. energy markets," said Jason Bordoff, director of the Columbia University Center on Global Energy Policy. "Coal can't compete with cheap gas and renewables. TVA's own analysis justifies reducing the use of coal in its power mix."
The Energy Department under Trump urged the independent Federal Energy Regulatory Commission to order subsidies for coal and nuclear plants in the name of the reliability of the electrical grid, but the commission rejected the call, citing other factors as more important in ensuring reliability. Four of the five members of that panel were appointed by Trump, but the vote against the Energy Department plan was unanimous.
The president later urged the Energy Department to declare a national emergency to keep aging coal and nuclear plants open, but the department has not done so.
"We've not had reliability problems," Hopson said. "We have been 99.99 percent reliable for 19 consecutive years. We are very proud of our reliability."
The Tennessee Valley Authority was established during the Great Depression in 1933, and it built dams and harnessed hydropower to help the impoverished region. Today, the TVA serves 10 million customers in seven states. It also provides flood control and helps manage navigation on the Tennessee River.
The TVA has a nine-member board, but there are two vacancies. Trump has appointed four of the seven active members. The agency receives no taxpayer money.
"Arguments that we need to support coal for national security reasons are not supported by any objective analysis," Bordoff said. "There is no basis for supporting the president's call."
Business on 02/13/2019